February 13, 2014

The Honourable Yasir Naqvi, MPP Minister of Labour 400 University Avenue, 14th Floor ON M7A 1T7

Re: Reforming ’s Broken Interest Arbitration System

Dear Minister Naqvi,

On behalf of the Ontario Chamber of Commerce and its network of 160 local chambers of commerce and boards of trade, we are writing to express concern over the impact that the province’s interest arbitration system is having on Ontario’s competitiveness.

As you are aware, interest arbitration is the only legal mechanism available to municipalities to settle contract negotiation disputes with essential municipal workers such as police officers, firefighters, and some paramedics.

Partly as a result of interest arbitration, emergency service costs are growing much more quickly than the Consumer Price Index, and faster than the average growth rate of other public sector workers’ wages, including nurses and teachers. As a result of the costly contract settlements created by the current interest arbitration system, there is significant pressure on municipalities to raise taxes and/or reduce services to compensate.

Competitive tax rates and quality public services are key to economic development and prosperity in our communities. The current interest arbitration model is hurting municipalities’ economic competitiveness, and ultimately the competitiveness of the province.

We recommend that the following changes be made to the interest arbitration system:

• streamline the process by adopting the single arbitrator model for all hearings, imposing limits on pre-hearing processes and post-hearing submissions and mandating a maximum period of one year (from the start of the process to its completion) for arbitrators to complete their work;

• arbitrators should be provided with clear, measurable criteria upon which to base their decisions, particularly regarding the “fiscal health” of the community;

• arbitrators should be required to provide a written explanation of their decisions, with clear assessments of the mandated criteria for arbitration, and must give priority to how the “fiscal health” of a community was considered when making a decision; and

• the “ability to pay” criteria used in interest arbitration decisions should be broadened to include the wider economic and fiscal environment, and productivity criteria (as recommended by the Commission on the Reform of Ontario’s Public Services).

1 We are increasingly worried about the negative impact of unsustainable increases in emergency services labour costs on Ontario’s municipalities and the broader Ontario economy. As a demonstration of the importance of interest arbitration reform to Ontario businesses and municipalities from across the province, 30 chamber executives have signed on to this letter.

We would be pleased to organize a meeting between you and a small group of representatives of the chamber network to further discuss these ideas and how the current interest arbitration framework is impacting our communities.

If you have questions or comments and would like to arrange a meeting, please do not hesitate to contact Josh Hjartarson, Vice President, Policy & Government Relations at 416-482-5222 ext. 2320 or [email protected].

Thank you,

Jim DiNovo Anne MacDonald Keith Hoey -Brant Chamber of Commerce and District Chamber of Commerce Burlington Chamber of Commerce

Greg Durocher Roberta Scarrow Gail Bishop Cambridge Chamber of Commerce Centre Wellington Chamber of Commerce Chatham-Kent Chamber of Commerce

Kevin Hargreaves Glen Baillie Kathleen Dills Cornwall & Area Chamber of Commerce Grand Bend & Area Chamber of Commerce Halton Hills Chamber of Commerce

Keanin Loomis Ann Campbell Matt Hutcheon Hamilton Chamber of Commerce Ingersoll District Chamber of Commerce Greater Kingston Chamber of Commerce

2 Gerry Macartney Richard Cunningham Debra Scott London Chamber of Commerce Markham Board of Trade Newmarket Chamber of Commerce

Walter Sendzik John Sawyer Allan O’Dette Greater Niagara Chamber of Commerce Oakville Chamber of Commerce Ontario Chamber of Commerce

Bob Malcolmson Bert Loopstra Jill Campbell Greater Chamber of Commerce Owen Sound & District Chamber of Commerce Perth & District Chamber of Commerce

Suzanne Andrews Rory Ring Mark Barsanti Chamber of Commerce Lambton Chamber of Commerce Sault Ste. Marie Chamber of Commerce

Julie Curran Bob Hammersley Debbi Nicholson Scugog Chamber of Commerce St. Thomas & District Chamber of Commerce Chamber of Commerce

3 Charla Robinson Phil Barton Matt Marchand Chamber of Commerce Timmins Chamber of Commerce Windsor-Essex Regional Chamber of Commerce

Martha Dennis Woodstock District Chamber of Commerce

cc. The Honourable Kathleen Wynne, Premier of Ontario Pat Vanini, Executive Director, Association of Municipalities of Ontario

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